Pay Increases among Canadian Employees

Canadian employees of top employing companies to see average salary increase of 2.6 per cent in 2014.

Canada (Photo credit: palindrome6996)

Oil and Gas, Services, Credit Unions and Chemicals employees are expected to have the highest increases in 2014; retail and leisure/hospitality workers to receive lowest increases

Canadian employees can expect an average salary increase of 2.6% in 2014, according to a national survey of public and private sector employers conducted by Hay Group.

The projected increase is lower than the projection for 2013 (at 2.9 %) and continues to be relatively close to projected increases of 2.8% for American employees. U.S. average projections are also lower for 2014 than they were a year ago.

Projected increases for Canada continue to be much lower than projected increases of 3.7 % before the 2008/09 economic downturn.

More than 500 Canadian organizations provided details of their planned salary adjustments for 2014 for the Hay Group survey, which was conducted in June and July. Participants include many of Canada’s leading employers.

Resource-based provinces continue to lead the rest of Canada

This year, the highest increases are in the Oil and Gas sector at 4% despite the strategic issues in the industry that have caused some moderation in long term investment. Services (at 3.3%),Credit Unions (at 3.2%), Chemicals (at 3.1%) and Utilities (at 3.0%) are also forecasting increases that are higher than the national average. These high forecasts are a continued reflection of the demand for key skills and experience.

Not surprisingly, Newfoundland and Labrador (at 4.0%), Saskatchewan (at 3.4%) and Alberta (at 3.2%), lead the country, buoyed by the demand for key skills in the resource industries despite the challenges in these markets. A clear divide between the provinces continues, with resource-rich provinces coming in between 3.2 – 4.0%, with the rest of Canada predicting increases of 2.1-2.6%, all of them at or below the national average.

Province

2014 projection

2013 projection

2012 projection

2011 projection

BC

2.3%

2.7%

2.5%

2.4%

Alberta

3.2%

3.6%

3.4%

2.9%

Saskatchewan

3.4%

3.2%

3.2%

3.3%

Manitoba

2.6%

2.7%

2.5%

2.7%

Ontario

2.5%

2.7%

2.7%

2.4%

Quebec

2.6%

2.7%

2.8%

2.7%

Maritimes

2.1%

2.6%

2.4%

2.7%

Newfoundland

4.0%

3.4%

3.4%

3.5%

GTA

2.5%

2.8%

2.7%

2.5%

The sectors with the lowest projections for 2013 are Leisure/Hospitality (at 2.0%), Retail, Consumer Durables and Forestry & Paper (all at 2.1%). Overall, the public sector is forecasting noticeably lower salary increases (at 2.3%) than is the private sector (industrial and financial at 2.7%).

Canadians to fare better than some, but well behind other major economies

Canadian projections rank about average against some industrialized nations, above France (at 2.5%); Italy (at 2.2%) and Japan (at 2.0%), but behind others such as the US (at 2.8%) and UK (at 2.9% %). Canada still lags far behind the forecasts for India (at 10.8%), China (9.0%) and Russia (at 8.0%).

Other findings

The survey also included a number of other findings:

The actual base salary changes realized in 2013 were exactly as forecasted for the industrial (2.9%) and public sectors (2.5%) but lower in the financial sector (2.6% realized against 2.9% forecasted);

Saskatchewan and Newfoundland – two of last year’s biggest winners – have the highest 2014 base salary projections ;

2014 projections for Alberta are lower than they were in 2013, but still rank 3rd highest in Canada;

BC is showing projections lower than last year and below the national average,

Ontario and the GTA at 2.5% are below the national average;

2014 projections for China and Russia, while still much higher than most economies, have moderated between one-half to 1% from those made for 2013, while the projections for India have increased by more than one-half percent over 2013;

The opportunity to receive short-term incentives has increased for senior and middle management in the private sector, but there are fewer opportunities for employees at the supervisory and clerical levels.

Details of the survey results will be released at a series of breakfast presentations being held in major cities across Canada in September.